The City of Morgan Hill has uncovered more than $5 million worth of unspent impact fees—paid by developers more than five years ago—that officials say will go toward long-planned, large-scale infrastructure and public facilities projects.
Even though these projects—including a new fire station and the extension of Hale Avenue around the west side of town—might not be needed now, they are indispensable to accommodating the future growth of Morgan Hill, according to city staff.
Specifically, of the impact fees unspent from five years ago or more, about $1.4 million in storm drain impact fees is proposed to be allocated into the city’s Storm Drainage System Master Plan for the Upper Llagas Creek Flood Protection Project; about $440,000 worth of traffic impact fees will go toward the Hale/DeWitt Avenue extension; and about $3.2 million of unspent fire impact fees will fund the construction of a new fire station on Butterfield Boulevard.
The state law, known as AB1600, that regulates impact fees in California requires cities to “make findings” for any such development fees that have been unexpended for five years or more. The findings proposed by Morgan Hill city staff must be approved by the city council, which is scheduled to take up the question at the Dec. 6 meeting.
“The reason (the funds haven’t been spent) is some of those impact fees are for projects that are planned for but haven’t yet started,” said Morgan Hill Communications Manager Maureen Tobin. “We know we will need (the projects) and the impact fees are trying to address the impacts that will happen in the future.”
City staff released the 2017 Annual Development Impact Fee Report Nov.
29. Such an annual report—listing not only the unspent fees but also current impact fee schedules and balances—is also required by AB1600.
Hed: Long-planned projects
Perhaps the most eagerly anticipated of the three projects, among Morgan Hill residents, is the extension of Hale Avenue into DeWitt Avenue on the west side of downtown. This project has long been identified by officials and residents as key to relieve traffic congestion through Morgan Hill.
The city’s five-year Capital Improvement Program shows the project will cost just more than $4 million over the next three years (including the $440,000 in unspent impact fees). It is projected to be completed in 2019.
The estimated construction cost for a new fire station is about $3 million, which is slightly less than the unspent fire impact fees recommended for the project in the annual report. The city has not identified a construction timeline for the project, which has not been allocated any funding yet.
Several years ago, the city pointed to a property it owns next to the South County Courthouse on Butterfield Boulevard for the site of a new fire station.
The Upper Llagas Creek Flood Protection Project has about $5.25 million allocated in the city’s CIP. This project, currently in the early design phase after more than 50 years of discussion and planning, will expand and widen Upper Llagas Creek through downtown Morgan Hill and farther south. Its aim is to reduce the threat of flooding in the city’s downtown during heavy rains.
The Santa Clara Valley Water District, U.S. Army Corps of Engineers and state authorities are sponsors of the project.
The City of Morgan Hill, like many cities in California, imposes impact fees on developers of residential and commercial projects. These include water, sewer, storm drain, parks, traffic, library, police, fire and public facilities impact fees.
The full schedule of impact fees is included in the 2017 annual report, which can be found on the city’s website, morganhill.ca.gov.
The fees below are per single family home, but the fees rise for multi-family homes and commercial projects.
- Water impact fee: $3,751
- Sewer impact fee: $14,680
- Storm drain impact fee: $3,982
- Park impact fee: $5,566
- Traffic impact fee: $1,928
- Police impact fee: $794
